Posted by hpcp > 2017-01-12 00:04 | Report Abuse

Which analyst forecast RM100m net profit?

Posted by cemertugus > 2017-01-12 14:39 | Report Abuse

i think that analyst forecast for worst case scenario..

Posted by sosfinance > 2017-01-13 17:46 | Report Abuse

Shareholders' Fund @ 31/8/16

RM550 million

Sustainable Growth Projects
Est. RM'm
1) 4 Water Concession 80 (on going)
2) Plantation (2100 ha) 52.4 (RM25/ha x 2,096ha - as per TA - fair value for young palm oil)
3) Mini Hydro 100 (2018/9)
4) Solar Plant 100 (still waiting for details, estimates)

Total 332.4m (average of EBITDA of RM50-60m)

(It is more appropriate to evaluate concessionaire projects using comparison of EV/EBITDA, normally initial year has higher PE of 12-18X)

Not forgetting JV for property development deal

1) Kwasa Land (LT) - estimate of RM700m
2) Puchong Land

At current EV (Market Cap less net cash) about RM590m, and EV/EBITDA of say about RM130m (as per TA) of 4.5X deemed low.

Posted by sosfinance > 2017-01-15 12:03 | Report Abuse

COMPARISON
Scientex EBIT for FYE16 is 188:120 for Property:Manufacturing or about 60%:40%.
PAT is about RM232m and Market Cap is RM3,100m. PE is about 13.4x. (so how much PE should be given to manufacturing and property)
Investor don't seems to mind their property portion which grows faster than the manufacturing. In fact the property division has improved its ROE from 14% to 20%.

WHAT IS GADANG UP TO
Gadang investment of close to RM200-300m into utility/plantation/solar/hydro out of total shareholders fund of about RM550m is a good diversification into sustainable biz. And its natural transition part its biz from fully construction to property, makes more sense than a manufacturing going into property, because, property requires construction expertise, and it also improve ROE of the Company. I believe this is a great integration of biz, which using the expertise of engineering, construction and development (water, hydro, solar or plantation).

Isn't it how gradually IJM Corp, Gamuda and other big players started with 20-30 years ago?

Posted by sosfinance > 2017-01-25 18:17 | Report Abuse

1. Gadang 1H results is not bad, about RM46m, consistent with management guidance of more than FYE2016

2. PE is traded on the around 7x (MCap is 670m), the lower band of 6-12x. Total cash is RM247m. Net cash RM67m.

3. Market perception (still negative on Gadang) because property contribute about 56%, while construction is 40%. However, the fact is, Gadang is going into property at "lower cost" - land provided by others,
1) Laman View
2) Puchong
3) Kwasa Land
4) Capital City (sunk cost of about 30m)

Total GDV of about RM3.5b to RM4.0b with Minimum "land costs & sunk cost" (most developer must have spent about RM300-400million to buy land for such GDV). Semenyih land is RM100m.

4. End of the day is the EXECUTION is crucial. There is no point having large GDV but unable to SELL. So, we have to evaluate Gadang property carefully if it is SALEABLE. So far, so good (as per management). Similarly, there is no point of having large construction order book if the cost overrun.

5. Moving towards utility is the right move, earnings can only be realised later.

6. Gadang is not well liked at the moment because everyone in town got the MRT2 project, except Gadang. "Kwasa Land" and "Puchong Land" contracts are property contracts, some investors don't like it.

7. As mentioned earlier, if we look at IJM Corp profits, do we actually know how much % are construction, property, toll roads, plantations (over the last 10-20 years), it evolved. At the moment, no one cares, it is trading at PE of 21x. IJM was once upon a time is like Gadang. It evolves.

Posted by Ricky Kiat > 2017-01-26 21:20 | Report Abuse

bro sosfinance , refer to latest report, capital city project still not likely start recognized profit by gadang in big way, right ?